403(b) Tax Sheltered Annuity Plans
What is a 403(b) Plan?
A 403(b) plan is a voluntary retirement plan offered by public schools and other tax exempt organization to their employees to help supplement employee retirement savings. 403(b) plans allow employees to set money aside in a special account and invest it for their retirement.
Contributions are made under a Salary Reduction Agreement (SRA) with the District. This agreement allows the District to withhold money from your paycheck to be contributed directly into a 403(b) account for your benefit. Usually, you do not pay income tax on these contributions until you withdraw them from the account.
Why Save with a 403(b)?
- You do not pay income tax on allowable contributions until you begin making withdrawals from the plan, usually after your retirement.
- The money you put in your account, as well as earnings, grow on a tax-deferred basis.
- Generally, retirement assets can be carried from one employer to another.
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Sample of Future Retirement Savings Value Assuming 6% Yield on Investment |
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| Monthly Contributions | 5 Years | 15 Years | 20 Years |
| $50 | $3,489 | $14,541 | $23,102 |
| $200 | $13,954 | $58,164 | $92,408 |
| $500 | $34,885 | $145,409 | $231,020 |
Frequently Asked Questions (FAQs)
Do I need to invest with OMNI & TSACG?
OMNI is a third party administrator (TPA) of 403(b) plans. We work with your employer to help ensure compliance with IRS regulations governing the operation of 403(b) plans. OMNI also helps your employer remit 403(b) contributions to participating investment providers. OMNI is NOT an investment company/investment provider- we do not offer and cannot recommend any specific investment vehicle.
How do I select an investment provider from the approved providers in my employer’s plan?
Each investment provider offers difference investment products, each with different features. In order to select the right investment provider for your retirement needs, it is recommended that you contact each provider in the plan to determine the best fit for you.
Who is eligible to contribute to a 403(b) plan?
All full time employees are eligible by default. Part time employees may or may not be eligible, depending on the specifics of your employer’s plan. Contact the District for specific information regarding your eligibility.
How do I contribute?
Your first step will be to contact a participating 403(b) investment provider to establish your investment account. A list of participating investment providers for your employer is available on the District's Plan Detail Page. After working with your investment provider to establish your account and select investment vehicles, you will then need to complete an OMNI Salary Reduction Agreement (SRA) to initiate your deductions.
Can I change my deduction amount and/or investment provider?
Yes. Most employers place no limits on the number of changes you can make. Simply complete an SRA form and return it to OMNI to initiate a deduction change. To change investment providers within your plan, simply complete OMNI’s Contract Exchange form, and open an account with the new investment provider.
Who decides which investment providers appear on my employer’s list?
The District is responsible for choosing which Investment Providers appear on their list. Any investment provider which has completed an IRS mandated Information Sharing Agreement (ISA) could potentially be included on an employer’s vendor list.
I would like to use______ fund company for my 403(b) investment provider. How do I get them on my employer’s list?
Only the District can choose to add/remove vendors from their list of participating providers.
How much can I contribute to my 403(b) plan?
Contribution limits are dependent on a number of factors. The IRS base limit in 2021 is $19,500. Employees over the age of 50 are automatically eligible to increase this amount to $26,000. Individuals with more than 15 years of consecutive service with their current employer MAY be eligible to contribute up to an additional $3,000 beyond their age based maximum. Please contact OMNI's Customer Care Team for assistance determining your eligibility for the service based catch-up.
Getting Started:
Your first step will be to contact a participating 403(b) investment provider to establish your investment account. A list of participating investment providers for the District is available on the District's Plan Detail Page. After working with your investment provider to establish your account and select investment vehicles, you will then need to complete an OMNI Salary Reduction Agreement (SRA) to initiate your deductions.
Investment Types:
- Fixed Annuities
- Fixed Index Annuities
- Variable Annuities
- Investment Advisory Service
- Mutual Funds
Participating Investment Providers:
- AIG Retirement Services (formerly VALIC)
- Ameriprise Financial/RiverSource
- Equitable (formerly AXA)
- Global Atlantic Financial Group
- Horace Mann Life Ins. CO.
- Invesco Oppenheimer Funds
- Lincoln Investment Planning
- NY Life Ins. & Annuity Corp.
- PenServ SmartSAV (formerly Foresters)
- Security Benefit
- Voya Financial (Reliastar)
- Waddell & Reed Inc.
Information and Forms Links
Calculator
403(b) plans are only available for employees of certain non-profit and/or tax-exempt organizations such as 501(c)(3) corporations, including colleges, universities, schools, hospitals, etc. A 403(b) can be one of your best tools for creating a secure retirement. It provides you with important advantages. All contributions and earnings to your 403(b) are tax-deferred. You only pay taxes on contributions and earnings when the money is withdrawn.
